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INDUSTRIAL PROBLEMS. 



FINANCE AND THE TARIFF 



AS RELATED TO THE 



INDUSTRIAL SYSTEM 



GOLD and SILVER^ 1 

AS 

MONETARY BASES. 





T77"0^2I^Z2SrO-3iviCE!iT W 



BY A 



WORKINGMAIV. 



There is no Cause but Labor. 



PRICE, 15 CENTS, 



BECKERT & MoGURDY, Printers. 
Washington, D. O. 



\^ 



to 



FOUR GREAT SYSTEMS. 



THE INDUSTRIAL, 

FINANCIAL 

CREDIT, AND 
PROTECTIVE. 



SXJG-G-ESTIOITS. 




Advance Business Prosperity. 

Encourage Co-operation. 

Promote Industrial Activity. ^. U 

Encourage Co-operation among Workingmen. ji ^ 

Protect Home Industry. 

Coin Good Money. 

Pay Good Wages. 

Vote Intelligently. 

Vote for Good Men. 

Encourage Popular Education, 

Build Public Libraries and Reading Rooms. 

Turn Down Snobs. 

Be Sociable. 






c: 

■"V 

Entered according to Act of Congress, in the year of 1895. 

By C. W. DICKEY, 

In ttie office of the Librarian of Congress, at Washington, U. C. 



THE INDUSTRIAL SYSTEM. 

C. W. DICKEY. 



The tendency to ascribe to other than their true causes conditions 
affecting the public welfare, seems never to have been better illus- 
trated than in the willingness to attribute all of the ills of life to 
the well-directed efforts of those who control our industrial affairs. 
That a social system, based upon freedom of contract, contains, quite, 
all of the elements of safety to popular government is evidenced, 
by the greater intelligence, higher sense of justice, and more con- 
servative character, resulting as the outgrowth of that system. The 
enlighted judgment, to correctly estimate the forces which tend to 
promote the welfare of society is a natural outgrowth of a social 
system based upon freedom of contract. And yet while an intelli- 
gent use of capital contributes, so greatly, to an equitable distribu- 
tion of the products of labor, and while the beneficent influences 
of law and government are so manifest in furnishing safeguards to 
life and property, there are those who try to ignore these agencies 
of human progress, and who declaim against law and government, 
as hindrances, rather than aids, to the well-being of society. 

That commerce has long been regarded a civilizing agency is due, 
in part, to the fact, that the minds of men have been brought in con- 
tact with new, and varied scenes as multiplied and diverse, as the 
diversity in character of the products of different parts of the earth ; 
likewise the industrial system performs a similar office, but with 
infinitely greater efficiency, in familiarizing the human mind with 
the forces of the material world, revealed by science, and clothed 
in tangible form by the inventor's genius, and artizan's skill. Who- 
ever, by his inventive power, promotes the division of labor, and by 
opening new fields for enterprise and industry, heightens human 
happiness, furnishes new hope to. humanity, in the greater guaran- 
tees afforded for the permanency of free institutions. Whoever 
fashions into fornix of strength, of beauty, or symmetry, some prod- 
uct of the forest, the quarry or the mine, contributes to the perma- 
nent wealth of the world, in the development of human character. 

That the human race has been able, to develop the higher arts of 
living, and attain to a high standard of virtue and intelligence, is 
largely due to the capacity of the human mind for organization, for 



4 INDUSTRIAL PROBLEMS. 

through its agency, races and nations have been consolidated and 
thus enabled to transmit to future generations, the accumulated 
product of centuries, in the domain of art and science, of govern- 
ment and law. 

Under a social system, based upon freedom of contract, the sel- 
fish instinct is made to subserve a beneficent purpose, for the higher 
the arts of living become under such a system, the more numerous 
and varied the wants of men, the greater the opportunities afforded 
to all, to better their condition, and attain to a higher plane of use- 
fulness in life. This higher social plane, involving ever increasing 
responsibility, nevertheless, becomes an incentive to greater aspira- 
tions and still higher effort. Human life, thus, acquires that marked 
degree of interest, only possible, in a complex society of varied in- 
dustrial pursuits. It is difficult, to see how the selfish instinct can 
be made to subserve so beneficent a purpose, as thus to make it an 
agency, for ministering to the wants of men, under a social system 
based upon freedom of contract. 

Whoever is able to realize the condition of man under a militant 
type of society, and coercive form of government, and to contrast 
that condition, with such as prevail under free institutions, may well 
reflect upon the causes, which have enabled the human race to attain 
to this condition of prosperity which accompanies civil liberty. 
Prominent among the agencies which have contributed to this end 
are the guarantees to liberty, and security to life and property 
afforded by the protection of law and government ; the primary 
cause being the instinct of self-preservation, leading to co-opera- 
tion and social organization, for mutual protection and improvement. 
In a society, where liberty is regulated by law, where all are enabled 
to pursue the peaceful avocations of life undisturbed, the division 
of labor, and multiplication of industries becomes possible, enabling 
a multitude to live in peace and security, as against the meager pop- 
ulation subsisting in a precarious manner, in a state of lawlessness 
and violence. 

That the free discussion of public questions peaceably carried on 
is a powerful instrument for educating the public mind will scarcely 
be questioned, so great is the tendency of free discussion to awaken 
and keep in training the best powers of the mind; and in no other 
way, as history shows, can be formed that intelligent public senti- 
ment, which is ever so great a guarantee of the safety of popular 
government. 

Thus, in ministering to our intellectual, and moral, as well as mate- 
rial advancement, does the industrial system fulfill its beneficent 
mission, and promise more than has ever yet been achieved, for 
man's future welfare. 



THE DEFENSE OF SILVER. 

C. W. DICKEY. 



The recent attempt to marshal the forces of fiat-money under the 
banner of free silver, as well as the attempt, during the last session 
of Congress, to secure recognition of a free-coinage measure, seems 
to deserve rather more than a passing notice, and to partake not a 
little of the folly contained in the action of the individual who 
tried to kill the goose that laid the golden egg. There are, proba- 
bly, but few Americans who do not realize that silver has been an 
extensive American product, and that in justice to the silver indus- 
try, such legislation should be granted, as is fairly due all American 
products. That such measures have been enacted, during the last 
twenty years, as would enable silver-producers to protect themselves 
against risks of loss, due to a rapidly depreciating product, no one 
conversant with facts, and disposed to deal fairly with all branches 
of American industry, will deny. The expense of maintaining a 
gold reserve, sufficient, to preserve the interchangeable value of all 
forms of our currency, ought not to be considered a burden, when 
compared with the advantages resulting from public credit. The 
fact of the possession of vast undeveloped resources, together with 
an enterprising and prosperous people, and all of the appliances for 
the development of wealth, will enable a nation to bridge over 
periods of distress, by use of its credit, which, otherwise, might be 
quite impossible. The fact, that a limited quantity of a debased 
metal, can be maintained at a fixed ratio with gold, is quite differ- 
ent, from an undertaking, to maintain an unlimited amount of such 
metal, at such ratio. As to the folly of enacting a free-coinage 
measure, can it be doubted, that the agitation of the silver question, 
coupled with the legislation of recent years, has been a potent factor 
in reducing our nation to its present distressed condition., necessi- 
tating an issue of bonds, to insure the maintenance of public credit? 
That some relief, from the pressure of the times, is desirable, is not 
less the opinion of the author of this work, than of the public ; but 
that anything less than disaster would result, from the adoption of 
a free-coinage measure, is so remotely improbable, as to scarcely 
afford the shadow of a hope. Such result would be due to a depart- 
ure, from the time-honored policy of our Government, to preserve 



(i INDUSTRIAL PROBLEMS. 

its credit, by maintaining the interchangeable value of all of its 
currency, thus guaranteeing the validity of existing contracts, facil- 
itating the transaction of business, and encouraging the investment 
of capital. 

The occasional losses due to the transaction of business upon 
credit, affords grounds for suspicion, that an equivalent in value, 
for commodities sold, or services rendered, may not, always, be 
forthcoming. This distrust is intensified, when in particular cases, 
a positive doubt exists, as to the fund available for satisfying an 
indebtedness. This distrust tends to obstruct trade, and is compar- 
able to that which prevails in the business world, when the validity 
of the monetary standard is questioned. Examples are numerous 
enough, showing the disastrous results, from attempting, to conduct 
business upon credit, without a sufficient basis of value upon which 
to support it. And if a basis of value is so essential, and a unit of 
value so convenient in effecting exchanges, why should they not 
be the best that can be obtained, as exemplified in gold, the world's 
standard of value ? The ill effects, likely, to result, from the adop- 
tion of a debased monetary standard, is comparable to that which 
an individual would sustain from over- trading, or a reckless expen- 
diture of his resources. Some persons favor silver, as being the 
people's money; with such the belief exists, that a guarantee of 
honest dealing attends the use of silver, from its being so well 
adapted to the e very-day transactions of life. 

No credits are involved, no distrust prevails, no complexity or 
obscurity exist, where every dealing is reduced to a simple cash 
transaction. This is a quite plausible theory, and if found conso- 
ant with all attendant circumstances and conditions in business, 
might be readily adopted in practice. But why any reason for 
questioning its validity, why not adopt the unlimited coinage of 
silver upon the ratio of sixteen ounces of silver to one ounce of 
gold? Plainly the answer is, depreciation, and resulting instability 
in the value of silver, which totally unfits it, for use, as a standard 
by which, to regulate the value of the world's commodities ; and 
the impending danger that it may become such stnndard, in obe- 
dience to a well-known law of finance, by which the cheaper cur- 
rency always drives out the dearer and better, and takes its place 
as the circulating medium. Part of what purports to be a dollar 
in silver, coined at its present ratio, is purely fiat-money, and par- 
takes of the nature of an invalid paper promise. It is only the 
known ability, and purpose of our Government, to maintain all of 
its currency, at par with gold, that enables the silver dollar to pur- 
chase a dollar's worth of commodities. Were it not for this import- 
ant fact, all of our silver, in circulation, could only be estimated at 
its bullion value; and our paper money, like the invalid paper 



INDUSTRIAL TRCBL-EMS. 7 

promise of an insolvent debtor, would be worth but little, if any 
more, than the paper upon which it is printed. 

If the insolvent debtor could demonstrate his ability to pay a 
large part of his indebtedness, his creditors, or others, might suc- 
ceed in exchanging his promissory notes, for money, or commodi- 
ties ; but the prudent business man, who wished to secure, beyond 
peradventure, an equivalent for his products, would exact a dis- 
count on such notes, or in lieu thereof, demand a price, sufficiently 
in excess of current prices, to compensate for any risks he might 
incur. Such is the principle which underlies the theory of inflated 
prices, being, merely, a measure of the lack of confidence of the 
public, in the circulating medium. And with an unstable standard 
of value, as a result of the exclusive use of depreciated money, it 
is easy to see that prices would vary, with almost the same degree 
of uncertainty that characterizes the changes in the atmosphere. 
Who does not believe that plain working-people would be at a dis- 
advantage, under such conditions ; and that none but those favored 
with opportunities for information, concerning changes in prices, 
or others skilled in financial operation, could hope to keep pace 
with these fluctuations in value ? 

Would not all the advantage, under such conditions, be with the 
so-called gold-bug, of which the free-silver advocate, so much com- 
plains ? The disadvantage attending a redundancy of currency of 
less value than gold is, that it is an approach to this condition of 
inflation which unsettles prices, destroys confidence, and threatens, 
with danger, the basis of value, itself. As money, in superabund- 
ance, seeks the most available places for investment, and, as the 
best money always departs under such conditions, any loss of con- 
fidence in the administration of affairs, any condition that tends to 
contract business, and prevent the development of wealth, lessens 
the demand for money, and tends to its depreciation. This less- 
ened demand for money, through modern facilities for exchange, in 
connection with the greatly increased production of silver, through 
improved mining processes, has caused the great commercial 
world to discard silver, except for subsidiary purposes. And why 
should we question the fact, when so consonant with reason, and 
so in accordance with natural laws ? As well, might we attempt to 
reverse the law of gravitation, as to try to check the onward move- 
ment of the world, as exemplified in the working of its great econ- 
omic laws. The tendency, to pervert justice, has so many possibil- 
ities, in the frailties of human nature, that it is only by a rigid ad- 
herence to correct standards, that the evil-disposed can be restrain- 
ed, and the worthy protected. To corrupt the fountains of justice, 
by legalizing a dishonest currency, would be but little better, than 
to legalize crime, for it would be a stex> in that direction. It may 



8 IXDl'STKIAL PKOBLEMS. 

be, that some who advocate the free-coinage of silver, do not re- 
alize the full significance, which such an act imports. It can hardly 
mean less, under present conditions, than silver mono-metalism ; 
and this implies isolation from the world's trade, by reason of hav- 
ing no common unit of value, with which to settle international 
balances. The celebrated Parisian banker and financier, Henry 
Cernuschi, a great authority upon so-called bi-metalism, in reply to 
questions by members of the United States Monetary Commission, 
as given in the published report of that commission, page forty- 
eight, presents the following views : " If you are bi-metalic, when 
Europe is mono-metallic, you are bi-metallic in name only ; verily, 
you would be a silver mono-metallic country, such as India, and 
the monetary position of the United States against Europe, would 
be, exactly, the same, as the present position of India against Eng- 
land, a position which engenders heavy losses upon both countries." 
Commenting upon the dangers incident to free-silver coinage, a 
recent financial writer has said : " If any man who has bullion in 
his possession can demand that the Government shall coin it for 
him, and stamp upon its face a certificate of its value which is in 
excess of its true value, and can thereafter take the coin to the 
Treasury of the United States, and receive for it a silver note, he 
his it in his power to prevent the Government limiting the volume 
of its obligations. The only limitation will be the amount of sil- 
ver bullion in the world, or the credit of the Government." We 
already have a heavy responsibility in the coinage of silver and 
stamping it at a ficticious value. Our purchases of silver under 
various acts of Congress have amounted to — 

503,003,811 line ounces, for which we paid 8 r )l<!,<'>2-!.011 

The value at the market juice of to-day is 334,925,088 

Showing a net loss of 181,697,?-23 

Thus do the world's authorities explain the facts in regard to sil- 
ver. The merits or demerits of a subject in controversy may some- 
times be afforded new light by an inspection of the motives prompt- 
ing the belief of those who respectively affirm or deny. An inspec- 
tion of the motives, prompting the belief in the delusion of cheap 
money, reveals the fact, that such delusion, quite frequently, re- 
sults, from a lack of well-defined ideas, concerning the uses of 
money, as adapted to modern methods of exchange. Where credit 
forms so important an element in business, the importance of the 
monetary standard, by which values are regulated, can hardly be 
overestimated. Many very enthusiastic believers in the efficacy of 
a Government stamp, to create value, as well as in the practicabil- 
ity, of maintaining a double standard of value, tacitly admit the 
unreasonableness of their claims; for, when stating the value of 
commodities, such value is, invariably, found to be in terms of gold. 



INDUSTRIAL PROBLEMS. 9 

Thus, almost unconsciously, does the flat-money theorist acknowl- 
edge the validity of gold, as the only standard of value. The claim 
of the free-coinage advocate, that there is not enough money to 
transact the business of the world, and, as a result of this scarcity 
of money, a demand exists for the unlimited coinage of silver, is 
found to be unwarranted by the facts. Why, if this claim be true, 
has there been so much prosperity up to quite recent times, the 
increase in currency being nearly uniform during recent years *? 
Have wealth and population increased, so rapidly, during these 
years, as to cause a virtual contraction of the currency ? Is it not 
a fact, that, instead of an increase of wealth, and expansion of busi- 
ness, there has been diminished production of wealth, and contrac- 
tion of business ; and, instead of a scarcity of money, an abundance 
exists ; as shown by low rates of interest, and a demand for good 
paying investments ? The plea of the free-silver advocate, that the 
increase in wealth and population, during recent years, and abund- 
ance of commodities, delnand a greater volume of currency, to sus- 
tain prices, is, plainly, false in theory ; for as a result of modern 
methods of exchange, the facilities for communicating intelligence, 
use of the credit system, better administration of justice, prompt 
execution of law, and other auxiliary agencies ; the demand for 
money, for purposes of exchange, is ever becoming less. This les- 
sened demand, and resulting depreciation in the value of money, 
ever, tends to keep pace with increase in productive power, and, 
thus, is afforded another beautiful example of the law of compen- 
sation, at work in the world. The capacity of some persons to en- 
tertain these delusions in regard to money and values, seems, only, 
to be equaled, by their capacity for opposing whatever is legally 
established, and sanctioned by usage. The fiat-money theorist is 
almost invariably found to entertain no small amount of ill-found- 
ed prejudice against those, who, through business enterprise, are 
endeavoring to bring a little prosperity into the world. It seems 
to make no difference how legitimately wealth may have been ac- 
quired, or how many worthy people in humble circumstances, may 
have been benefited thereby, the mere fact of the possession of 
wealth, or of even being in fairly prosperous circumstances, is 
deemed a sufficient cause, for overturning any existing monetary 
system. It matters not how much the acts of the silver producer 
may have contributed to the debasement of silver, through over- 
production ; he is ever ready to levy tribute upon a generous and 
forbearing public. The representative fiat-money theorist appears 
to ignore the fact, that it is not only not in opposition to social 
order, that some people, through better opportunities, and, it may 
be superior ability and integrity, attain to prominence in affairs, 
but that it is altogether suitable and proper that such should be the 



10 INDUSTRIAL PROBLEMS. 

case, and perfectly consonant with the highest degree of social or- 
der. As to the relief anticipated, through the adoption of a free- 
coinage measure, is it not in accordance with another form of be- 
lief which prevails, so largely, with persons of, relatively, small 
intelligence, and great credulity, who manifest so little concern, as 
to the outcome of public measures ; namely, that it is of no great 
importance what measures are adopted, or how administered, that 
all will work out right in some way ? There are some who advo- 
cate the free coinage of silver, from selfish and mercenary motives 
alone. Can there be a doubt, that the owners of silver bullion, be- 
lieve themselves to have been the chief beneficiaries, from the en- 
actment of such laws as the Bland Act of 1878, or the, so-called, 
Sherman law of 1890? Whence the tenacity of purpose, exhibited 
by these people, who talk so loudly about usurers and gold-bugs ? 
Is it not a well-known fact, that these self-appointed conservators 
of the public welfare, these so-called champions of bi-metalism, 
who, so persistently, endeavor to prejudice the public mind against 
legitimate industry, are themselves the real gold-bugs; and that 
all of their scandalous talk is, merely, for the purpose of diverting 
public attention from their real object?' This brazen-faced effront- 
ery, this loud and deceptive talk, to sustain the price of a deprec- 
iated commodity, for the benefit of bullion-owners, has been so 
convenient a method of looting the public, that the promoters of 
this policy are loth to relinquish it. The most discouraging feature 
of the silver controversy is, that no one except the owners of silver 
mines, and those, identified with them in interest, could, by any 
possibility, derive any advantage from the free-coinage of silver; 
but would, instead, suffer almost irreparable losses. It is plainly 
a case, similar to that of the inebriate who ever requires a fresh 
potation to revive his failing spirits. 

The true defense for silver is to advance business prosperity, and 
promote industrial activity, thus, creating a demand for all of the 
nation's currency and appreciating its value. Clearly, what is 
needed, is a restoration of business confidence, and this would be 
obstructed, by any further tampering with the basis of value. 
Plain working people would receive only chips and whet-stones, 
from legislation in accordance with the demands of the free-silver 
agitator, while mine-owners and bullion-owners would reap the 
harvest, which would be a harvest of gold. That the American 
people with the good business perception usually accorded to 
them, should allow themselves to he deluded, into any false steps, 
in relation to this fatal policy of free-silver coinage, while, already, 
possessing a relatively sound and stable currency, would be hardly 
less surprising, than deplorable. 

Would those who have invested their earnings in the savings banks 



INDUSTRIAL PROBLEMS. 11 

of the nation derive any thing but loss ; from legislation that would 
result in placing affairs upon a silver basis, or the vast army of wage- 
earners, whose wages, in virtue of their present high purchasing 
power, are the means of moving a. vast quantity of the nation's 
products? Could any advantage result from discounting the 
savings and wages of working-people, still further contracting busi- 
ness, already at so low an ebb ? That there is a limit beyond 
which a nation, in common with an individual, can not, safely, pass, 
in issuing its promises to pay, seems, never, to have been, seriously, 
entertained, by the advocate of fiat money ; he appear to believe 
that some magical significance attaches to the term money, or legal 
tender, which releases a nation, issuing its promises to pay, from 
the legal, or moral responsibility, which attaches to the maker of 
any other kind of contract. That a nation, in doing a banking busi- 
ness, can depart from well-established banking principles, and reap 
anything but disaster, appears to be remote from the thoughts of 
the fiat-money theorist. There are some, who, honestly, entertain 
this delusion, in the belief, that an increased volume of money will 
enhance prices, and cause activity in business ; apparently, over- 
looking the fact, that any increase in the volume of currency, above 
what is required to transact the business of a nation, is powerless 
to affect prices, while all currency is maintained at an interchange- 
able value with gold ; and the further important fact, that promises 
of any kind recognized by the commercial world, whether guaran- 
teed by the signature of an individual, or by the stamp of a govern- 
ment, are of but little value, unless capable of being redeemed, in 
some substance, recognized by the world as possessing value. As a 
rule, the advocates of gold, as a monetary standard, recognize the 
necessity for stability of value, as a pre-requisite to business pros- 
perity; they see in gold an instrument for measuring values, recog- 
nized by the world, as the best that can be obtained ; hence, their 
adherence to it, as being most likely, to insure stability, and cer- 
tainty in all business transactions. That all of the avenues to pecu- 
lation, fraud, and oppression, would be opened up, the validity of 
existing contracts impaired, and a vast train of evils result, from the 
adoption of a monetary standard lacking in stability, accords with 
the belief of the advocate of sound money. 

As to the validity of any further claims, on the part of silver- 
producers, for legislation, to arrest the decline in price of silver, 
what would be thought of legislation, to sustain prices of other com- 
modities, as cotton, domestic animals, iron or wheat? Would not 
such a law be, rightly, regarded, as a most extreme form of class 
legislation ? Yet wherein does it differ, in so far as the effort, to 
sustain the price of a depreciated commodity is concerned, from 
the methods proposed by the advocate of free-silver coinage? But 



12 INDUSTRIAL PROBLEMS. 

it may be said, that silver is a precious metal, used as money for 
centuries; it can not, justly, be placed upon the same plane with 
other commodities. The reply might be, that iron, wheat, and do- 
mestic animals, have been used as money, in different ages of the 
world. In so far, as serving some of the purposes of money, wheat 
would not, so far, fall short, even in our day; it has durability, as is 
implied in the common expression, as good as old wheat; and, as 
for stability of value, it is quite as stable as silver; and as for con- 
venience of exchange, wheat certificates could be issued, quite 
as readily as silver certificates. There would, still, be a further 
advantage, that the demand for wheat in times of distress, 
unlike the demand for silver, would tend to keep it at an inter- 
changeable value with gold; thus tending to eliminate one of the 
sources of trouble in modern finanical legislation, involved in the 
effort to sustain the price of a depreciated money-metal. We, 
really, can not see, why the growers of wheat have not been pushing 
their claims, to recognition, at the hands of the government. There 
is a theory, quite prevalent among those, who mis-apprehend the 
utility of gold as a standard of value, that it is appreciating in 
value, as a result of the increased demand for its use as money, and 
that as a result, all other commodities are depreciating. Failing to 
note the wonderful increase in productive power, through the in- 
creasing use of steam and electricity, and their application to the 
mechanic arts, and consequent saving of human labor, and dimin- 
ished cost of production, the advocate of fiat-money can see no other 
cause for low prices, than appreciation in the value of gold. The 
best authorities agree that the supply of undeveloped gold in the 
world, is, amply, sufficient, to meet any demands, that are likely to 
arise, for its use as money, for centuries; and that no observable ap- 
preciation, in its value, has thus far taken place. 

M. Leroy Beaulieu, one of the world's greatest economists in an 
article, published July 1, 1893, in the Economiste Francais, ex- 
presses the opinion, that it is not improbable that silver may, yet, 
decline to a value, as low as 33 cents on the dollar of our currency. 
As estimated by the same authority, the annual out-put of the 
world's silver mines, should present rates of production continue, 
may reach, by 1898, the sum of $400,000,000, a sum equal to more 
than nine times the annual out-put of silver from 1853 to 1857. 
The annual out-put of gold for 1897-8 as estimated by the author- 
ity above city, is practically, the same as for 1853-7, namely, $1(50,- 
000,000. In regard to any probability of the world's supply of gold 
falling short, we give the author's statement, as follows : " As to 
the pretended rarity of gold, we have often said that there is no 
reason to be alarmed. Without mentioning other countries, South 
Africa can furnish an increasing quantity of gold." Depreciation 



INDUSTRIAL PROBLEMS. 13 

in the value of commodities, is, clearly, due to other causes, than 
appreciation in the value of gold, prominent among which are im- 
proved facilities for manufacturing, better methods of distributing 
products, through improved facilities for transportation, and better 
means of communicating intelligence, by use of the telegraph and 
telephone. All of these agencies, by lessening human labor, dimin- 
ish cost, which can but result in lower prices. The free-coinage 
advocate seems to be guilty of torturing into a false signification, 
all of these beneficent agencies of modern civilized life. Low prices, 
far from being indications of distress, penury, and want, are har- 
bingers of better things, which lie in the direct trend of advancing 
civilization. Not the least of the ills, likely to result, from the in- 
stability of value, consequent upon the adoption of a silver stand- 
ard, would be the discredit, cast upon the validity of existing con- 
tracts. To incur indebtedness, upon a given basis of value, with 
the intention of liquidating same upon a lower basis of value, would 
not differ, essentially, from repudiation, and could not, therefore, 
be regarded in the light of strictly honest dealing. The instability, 
in the value of silver, constitutes the real problem. If there could 
be any assurance of maintaining anything like permanency of value 
in silver, affairs might, after a time, become adjusted to the new 
conditions. But wherein do present conditions warrant any such 
conclusion ? 

Regarding the causes of silver's depreciation, and resulting insta- 
bility of value, we quote from the Engineering News of August 10, 
18)3. In an article, entitled The Silver Status, the author states as 
follows : " But in recent years the product of gold has fallen some- 
what, and, though it has been lately increasing again, seems to be 
settling down to a moderate and nearly constant production of 
|120,00o,()00 to (possibly) $150,000,000 per year, with little chance 
of ever increasing the latter total, while the production of silver 
has increased apace from only one-fourth of the gold-production of 
1853-7, when the latter was at a maximum, and silver about a min- 
imum, to nearly twice the gold-production in 1892. In other words, 
the yearly out-put of silver has increased by leaps and bounds to 
nearly five-fold that of 1853-7, and to nearly three-fold that of 
1863-7, with every promise of indefinite further increase, from 
known, and seemingly inexhaustible sources of supply, by stead- 
ily improving metallurgical processes. The inevitable result has 
followed. Silver has fallen heavily, and what has, heretofore, con- 
stituted nearly half of the world's circulating medium has become 
discredited as such, and is rapidly passing out of use, in spite of 
unprecedented efforts to maintain its price by law." 

Should the free-silver propaganda succeed in having its claims 
allowed with such a discouraging outlook for silver, what encour- 



14 INDUSTRIAL PROBLEMS. 

agement would business men have for making investments of any- 
kind with every prospect of being repaid in money of lower value 
than that invested? Capital must have a prospect of fair profit, as 
surely as wage-earners must have living wages; for how else, can 
the expenses of business be met, the wages, taxes, rents, and inter- 
est, the wear and tear, and destruction of machinery, and supplant- 
ing same, by new and improved devices, the risks of loss by fire, 
lock-outs, and strikes ? 

The discouragement to business enterprise, consequent upon the 
adoption of a silver standard, cannot be regarded as second in im- 
portance, to any, connected with the silver question. As a fair 
illustration of the ill-effects, likely to result from the adoption of a 
silver standard, might be cited the results likely to arise, from use 
of a varying standard of weight or measure, as the pound or yard ; 
which, instead of being a correct standard, unchangeable, from year 
to year, should be found, gradually, besoming smaller, as indicating 
a lighter pound, or shorter yard. Would it require longer than a 
day, for people to rebel against such varying standard of weight or 
measure? In what essential particular, except in its capacity for 
greater harm, would a depreciating money-standard of value, differ 
from this varying standard of weight or capacity ? 

The world is rapidly becoming a financial unit, through modern 
devices for communicating intelligence, and interchanging commod- 
ities, and an all-important question for us to consider, is, whether we 
can afford to isolate ourselves from the world's trade, by the adop- 
tion of a monetary standard inimical to same. As the division of 
labor, and increasing specialization of industry demand better or- 
ganization, and higher rules of action, so, in the financial world, 
do facts justify us in the conclusion that we shall, by adhering to 
advanced economic standards, most surely subserve our interests, 
and by refusing to discriminate, unfairly, in favor of any special 
interest, most surely promote the welfare of all. 



THE GOLD STANDARD. 

C. W. DICKEY. 



In the treatment of the currency question, and discussion of the 
relative merits of gold and silver for use as currency, as presented 
by many writers on the subject, too little importance seems to be 
attached to conditions in society which create a demand for gold or 
silver respectively. The fact that in the early history of our coun- 
try the stage-coach was found to serve a very useful purpose as a 
mode of traveling, forms no sort of reason, that we shall fore-go all 
the conveniences of modern travel as experienced in the vestibuled- 
train and palace-car. The fact that our vast industrial machinery 
is found to glide more smoothly, supported by a monetary system, 
resting upon gold as a standard of value, conveys no sort of impres- 
sion to us, that the condition of semi-civilized countries, in which 
silver is found to meet all the demands of business, is superior to 
our own highly organized industrial system. 

A great deal of inflamatory talk has been indulged in by the ad- 
vocates of silver, concerning a shrinkage of values, and confiscation 
of property through appreciation in the value of gold, due, as al- 
leged, to it's having been made the standard of value by the lead- 
ing commercial nations. And yet, those who talk so loudly about 
gold having appreciated, so greatly, in value, at the expense of all 
other kinds of property, fail to inform us, why money can be 
loaned, and is loaned, at greatly reduced rates of interest, as com- 
pared to times prior to 1873 ; since which date gold is said to have 
appreciated, so greatly, in value : and notwithstanding the fact, of 
low rates of interest, and a constant cheapening of products, by 
which they are brought more nearly within the reach of people of 
moderate means, the legislation by which this has been brought 
about, is characterized, as an attempt to rob the people by demon- 
etizing silver. 

The bankers, merchants, and financiers of the world, have been 
subjected to a great deal of criticism, for a commendable effort, to 
subserve public interests, by a prudent management of the affairs 
over which they exercise control. The advocates of the free-coin- 
age of silver deplore the contraction in the volume of money, 
which, it is claimed, would result from — demonetizing silver, if as 



16 INDUSTRIAL PROBLEMS. 

the sudden inflation of prices consequent upon tlie adoption of a de- 
preciated standard of value would not be the worst possible form 
of contraction, accompanied as it always is, by an era of speculation 
and uncertainty in business enterprises. 

The contraction in the volume of currency and resulting disaster 
to business interests, as predicted by the advocates of silver, 
through restrictive legislation affecting silver, could not cause 
greater disaster than would result from the adoption of a depre- 
ciated standard of value, the prices of labor, and of all crude pro- 
ducts forming the necessaries of life, being last to rise in value 
during periods of inflation, and first to fall upon returning again to 
a bases for stability in value, thus, working a direct hardship upon 
tile laboring classes and small property-holders, who, for the most 
part, deal in the class of products, subject to this unjust discrimina- 
tion. Any advantage resulting to the wealthy classes, through 
appreciation in the value of money, due to its scarcity, would 
accrue, quite as readily, to those who live by wages, for if any one 
is interested in the possession of money, which will exchange for 
the largest measure of the conveniences of life, it is the person who 
earns money by daily labor. The history of the commercial world, 
during the past twenty years, has been marked, by an increase in 
the purchasing power of money. This is not due to any perceptible 
appreciation in the value of gold, as alleged by the owners of sil- 
ver bullion, but to other causes, and mainly to increased produc- 
tion, as well as better distribution of the products of labor, through 
the use of improved appliances, as labor-saving machinery, rapid 
transit, through the use of steam as a motor, improved methods of 
communicating intelligence, by means of better mail facilities and 
the employment of electricity in the telegraph and telephone, and, 
largely, to the efficiency of government, in maintaining the invio- 
lability of contracts and preservation of a sound monetary system, 
resting upon gold as a standard of value ; the wonderful elasticity 
and ever increasing capacity of the credit system to serve the 
demands of business, being largely the result of the confidence 
reposed by the business world in a monetary system, resting upon 
gold as a basis. 

The multiplied agencies that accompany advancing civilization, 
and which become such powerful factors in increasing the pur- 
chasing power of money, are, ever, found to be the wage-earner's 
best security against distress, enabling him to enjoy a larger share 
of a constantly increasing product, and guaranteeing greater liberty, 
for the acquirement of useful knowledge, and cultivation of all 
those qualities which tend to develop a high standard of citizen- 
ship. 

A great amount of money per-capit<a, or large volume of currency 



INDUSTRIAL PROBLEMS. 17 

in a nation, does not, necessarily, indicate a high degree of pros- 
perity, as notably, several of the years of greatest prosperity in the 
United. States, have been years in which the volume of currency has 
been lower than that of other years within the same decade ; while 
the industrial activity of years with money of high purchasing 
power, attests its value, as compared with years of inflated cur- 
rency, accompanied by instability in values. One of the best il- 
lustrations, because one of the simplest that can be given, showing 
the fallacy that business prosperity is dependent upon a large vol- 
ume of currency, is that given, not long since, by a well-kuown 
financial writer. 

The illustration is so apt, that we can hardly forbear repeating it, 
for the benefit of those who may chance to peruse this work. 

The currency of a nation is compared by the writer, to the vol- 
ume of water of a river. The volume of water is utilized, as a mo- 
tive power, to propel the machinery in manufacturing industries. 
Should the demand for the product of these industries be great 
enough, ten, or twenty, or a hundred times as many mills can be 
propelled, by the same volume of water. 

An analogy is, here, traced, between the volume of water of the 
river, and the volume of currency of a nation. Through organiza- 
tion, in the use of banks and clearing-houses, ten, or twenty, or a 
hundred times as much business can be done, as otherwise, with the 
same volume of currency. The more active business becomes, the 
more frequently money changes hands in small dealings, and the 
more frequently the processes of exchange are repeated in large 
dealings, through banks, and clearing-houses, and the use of the 
credit system. 

The fact, that the great commercial nations are, ever, tending 
towards the adoption of gold, as the best representative of an un- 
varying standard of value, is but an illustration of the workings of 
an imperative law, which ever tends to bring existing conditions 
into harmony with itself, — ever works to adapt industrial activities 
to new and progressive conditions ; the law of progress, from a 
wandering, wasteful, incoherent state of society, to an organized, 
law-abiding, and coherent state. Silver, having the capacity of sub- 
division into denominations of value, of great convenience in trade, 
serves a well-nigh invaluable purpose, as a medium of exchange, in 
facilitating the minor transactions incident to retail trade; and since 
countries of low industrial organization, the wants of the inhabi- 
tants being few and simple, are, almost wholly, lacking in the degree 
of confidence, so essential to the perfect working of the credit sys- 
tem, the demand for money of small denomination becomes imper- 
ative, and silver, so well adapted to the uses of subsidiary coinage, 
acquires a special value. 



18 INDUSTRIAL PROBLEMS. 

But in countries of a high grade of civilization, where confidence 
in the stability of government, and enforcement of law, forms a 
basis for credit, where the industrial activities are in full play, and all 
of the agencies for the transmission of intelligence, and interchange 
of commodities, exist in a high state of perfection, money, for pur- 
poses of exchange, ceases to have the value that belongs to it under 
other, and less favorable conditions ; the demand for money, as a 
medium of exchange, gives way to that higher function of money, 
in which it serves, as a standard of value, and is followed by all the 
benefits that flow, so naturally, from a long-established, and highly- 
developed credit system. 

Gold and silver, like other commodities, are governed by the law 
of supply and demand. 

The supply of silver, for use in the arts, or for purpose of coin- 
age, exceeding the demand, no valid reason appears to exist, for its 
being privileged over other commodities, in securing legislative 
action in its favor. 

The matter, here, outlined is but elementary in character, and 
the principles involved, familiar to most persons, who possess more 
than an elementary knowledge of the uses of money. But as ele- 
mentary principles may, sometimes, be re-stated with profit ; and, 
as much matter concerning the currency question, is being heralded 
before the public, we invite thoughtful consideration of the matter, 
here outlined, trusting, that it may not be found below the average 
of the mass of literature on the subject, in which the times abound, 
and as containing some facts, which may not be considered unim- 
portant, in assisting to arrive at a correct conclusion, as to condi- 
tions in society, which create a demand for gold or silver respect- 
ively, and enable to be determined their relative merit for use, as 
a medium of exchange, or standard of value. 



THE PROTECTIVE POLICY. 

C. W. DICKEY. 



It is to be regretted that in the discussion of the subject of Protec- 
tion to American Industry, so great a likelihood exists, through par- 
tizan or other reasons, of alienating the sympathy of many very esti- 
mable people, from the true purpose of this work, which is to discuss, 
thoroughly and impartially, questions of vital interest to the Ameri- 
can people. Bearing this fact in mind, it shall be the constant aim 
of the author, to give, what seems to be the general trend of thought, 
on the subject, rather, than to discuss it, from a merely, partizan 
stand-point. 

Closely related to the industrial system, in the manifold benefits 
derived from it, is the policy of different nations, relating to the 
protection of their industrial affairs. 

Realizing the immense possibility for human happiness under 
a popular form of government, and with full faith in the industrial 
system, as tending to preserve the independence of a people, the 
founders of our government sought to protect and encourage Amer- 
ican industry. 

The solicitude of the founders of our government, for the safety 
of our industrial affairs, as against foreign domination and inter- 
ference, was only equaled by their zeal in the cause of popular gov- 
ernment, and was, largely, due, to the belief entertained by them, 
that powers alien to our own, and unfriendly to popular government, 
should take advantage of their own intrenched position, in the pos- 
session of established industry to cripple, if not destroy, what to 
them seemed a dangerous innovation in government. 

That their belief was well-founded is shown by the fact, that for- 
eign nations have, ever, taken advantage of opportunities to advance 
their own interests, as illustrated in the protective policy, of the 
nations of continental Europe, as well as in the enactment of the 
Navigation Acts by Great Britain, and the granting of bounties to 
her manufacturing interests, and subsidies to her steamship com- 
panies. To the list of illustrious names of patriots, pledged to the 
support of American industry at the founding of our Government, 
including the names of Washington, Adams, Jefferson, Franklin, 
Hamilton, and Madison, may be added, 'at a later date, the names 



20 . INDUSTRIAL PROBLEMS. 

of Monroe, John Quincy Adams, Jackson, Benton, Van Buren, Clay, 
Webster, and Lincoln. Such an array of distinguished names, so 
closely identified with the foundation and growth of the American 
republic, is not without significance, in the consideration of any 
question, bearing upon American independence ; and is rendered 
doubly significant by the wonderful prosperity, attained by the 
American people under the protective policy. That commodities 
which can be produced, only in foreign countries, with profit for 
commercial purposes, and which have become so much, articles of 
common use, as to be indispensible to the convenience and welfare 
of the American people, should be admitted free of duty, or with 
but slight duty, for purposes of revenue, is, ever, in accordance with 
the American policy of protection; but that commodities which we 
can produce with equal facility with foreign countries, and in the 
production of which, we set in motion the wheels of industry, in 
our own country, should be subject to a reasonably protective duty, 
also accords with a true protective policy ; for we thus afford em- 
ployment to a multitude of working-men, and increase the demand 
for every product of American labor. Subordinate to the chief end 
of all industry, the development of the resources of a nation, and 
the character of its people, is the secondary consideration of 
ministering to an honest pride in the American working-man, in 
the patronage, afforded the product of his skill and industry, as 
well as to stimulate competition, and lower the cost of commodities 
to the American people. 

The advocates of an equitable system of protection are firm in 
the belief, that nations, which are supporting vast standing armies, 
and all of the costly equipment that, ever, accompanies monarchi- 
cal power, are a constant menace to popular government, that the 
burden of taxation, -which this system of military j)Ower entails 
upon the producing classes, in countries, where it prevails, can but 
entail hardships upon them, inconsistent with the intelligence, free- 
dom, and independence of the American citizen; that the wages 
paid to labor, in these nations, as compared with the wages Ameri- 
can working-men receive, is, of itself, a sufficient ground, for not 
permitting the foreign manufacturer and producer, to compete in 
the American market, on equal terms with the American manufac- 
turer and producer ; that to fail to take proper steps to regulate our 
own affairs, under such conditions, would be to deserve the disap- 
probation of the American people. That we are abundantly justi- 
fied, in adopting proper safeguards, against any interference by for- 
eign nations, with our industrial affairs, accords with the best senti- 
ment of the American people, and is in harmony with the policy, 
advocated by the founders of our government, and supported by 
every great American statesman of the present century. The objec- 



INDUSTRIAL PROBLEMS. 21 

tion sometimes urged against protection, that it encourages monop- 
olies, and enables great fortunes to be acquired, may be replied to 
by the statement, that protection is not responsible for the inequal- 
ities existing among men, but on the other hand tends to promote 
equality of conditions, and is, thus essentially, democratic in prin- 
ciple. That it is not, so much, of vital concern, that the few shall 
live in affluence and luxury, as that the many shall enjoy the com- 
mon comforts and necessaries of life, is the cardinal principle of 
protection ; and that men shall become free, intelligent, and self- 
supporting, rather than servile, illiterate, and dependent, is its 
higher law. That increasing wealth has, ever, been an accompani- 
ment of advancing civilization is abundantly shown by the history 
of nations. If such are the essential conditions of prosperity, it is 
better to have great wealth along with prosperity, than to have pov- 
erty, and dependence, and suffering, which ever attends a condition 
where wealth is undeveloped. The desire for wealth, as indicating 
a spirit of enterprise which subserves the public welfare, can but 
be commended. This desire has its foundation in the desire for 
personal liberty, and independence of action. Wealth has been, 
aptly, termed realized liberty. To condemn the protective policy, 
for affording opportunities for acquiring wealth, with accompany- 
ing national prosperty, would be to disregard economic law, and 
oppose all progress. That there does not exist any well-founded 
cause for alarm in regard to concentrated wealth, with all of the 
liberty that prevails under a popular form of government, is becom- 
ing more manifest, each year, with advancing civilization. 

As private property comes to be regarded more in the nature of 
a public trust, the spectacle of poverty, and oppression, through 
concentrated wealth, is discovered to be a mere delusion. To the 
extent that great enterprises, set in motion, and managed by men 
of great business capacity, contribute to the public welfare, do the 
promoters of these enterprises become the servants of the people. 
That those who declaim against wealth, and the rules of organized 
society, are, usually found deficient, either in moral character, or 
in knowledge of the principles upon which society is based, would 
seem to be a sufficient answer to any theories, propounded by them. 
The industry, self-denial, and concentrated effort, required to 
achieve success in life, are so manifest, and the physical hardihood, 
and independence of character resulting from the exercise of these 
virtues, are so marked in their influence, that any attempt to evade 
the wholesome restraints of society, by a resort to dishonest prac- 
tices, can but result in failure and disaster. The opprobrium 
which attaches to the term protection, from its being associated 
with the maintenance of vast industrial enterprises, and thus ap- 
pearing to savor of inequality, disappears, when it is viewed, as 



22 INDUSTRIAL PROBLEMS. 

helping to promote industrial activity, and thus support the better 
condition of living, to which the American people have become 
accustomed. That an import duty upon articles of, exclusively, 
foreign production, levied, solely, with a view to obtain revenue, 
operates, as a tax upon the consumer of those articles, will scarcely 
be questioned ; but that an import duty, levied with a view to ob- 
tain revenue, and so adjusted as to afford reasonable protection to 
similar articles of home production, thus, operates, is very far from 
being the fact; for it is the underlying principle of protection, that 
production is the source of all wealth, and that to afford employ- 
ment at liberal wages, is the surest way to attain to a high stand- 
ard of national virtue and excellence. That prices of protected 
articles may be enhanced for a time, may, or may not be the case ; 
but that such enhanced price, when found to exist, will continue 
for any great length of time, is, in the highest degree, improbable ; 
for the business sense of the American people prompts them to be, 
ever, on the alert for opportunities for profitable investment, and 
thus, prices must, ultimately, be reduced through a healthy compe- 
tition in business; and to the extent that combinations are formed 
to control production, and so regulate it, as to meet the legitimate 
demands of trade, will the people's welfare be subserved, in the 
end, by greater guarantees afforded for stability of prices, and an 
unfailing supply of the articles produced. 

To some, it may appear strange, and remote from the truth, that 
combinations of capital are not subversive of the rights of working- 
men, but on the other hand, minister to their welfare; but if such 
is the fact, it can be none the worse for being stated. We are com- 
pelled to account for things, as we find them, in this world, and not 
according to our pre-conceived notions of right or wrong ; ever 
bearing in mind, that effects result from certain causes, just as truly 
in the social world as in the natural world. Should we find, upon 
examination, that the lack of proper knowledge, or interest, or a 
tendency on the part of working-men, to demand more, at times, 
for labor, than the profits of business will justify, some of us might 
find grounds for revising our opinions, and amending our practice. 
A respect for truth will not permit us to affirm, without careful in- 
vestigation, that working-men have not, at times, been unreasona- 
ble in their demands. External appearances are often deceptive, 
and hasty conclusions are liable to be misleading. 

The concentration of vast capital in few hands, can only be justi- 
fied in the absence of co-operation, and upon grounds of public 
economy, securing the greatest good to the greatest number. 

Statistics show, conclusively, that, with the progress of industrial 
enterprise, there is a constantly lessening tendency to the consoli- 
dation of capital in few hands, and an, ever, increasing tendency to 



INDUSTRIAL PROBLEMS. 23 

co-operation, or the combining of the capital of the many. This 
is what might be expected, from the increasing intelligence and 
thrift and improved social condition of working-people. Why we 
should be compelled to forego all of the advantages resulting from 
increased efficiency in the management of capital, due to combina- 
tion, resulting in untold benefit to multitudes, is difficult to see. 
Why barren wastes should not be reclaimed, and deserts made to 
blossom as the rose, through the productive energy of mind in the 
management of capital, no one can tell. Why a Vanderbilt, a 
Cooper, a Peabody, a Deshler, or a Stanford, do not subserve the 
public welfare, and fill just as legitimate a sphere in the business 
world, as a Shakespeare, a Scott, an Irving, a Macaulay, or a Ban- 
croft in the literary world, or a Gladstone, a Bismarck, a Lincoln, 
or a Blaine in the political world, no one has ever yet been able to 
explain. That the public welfare is subserved, by combinations of 
capital in business enterprise, is but an illustration of the public 
utility of organization; and is, largely, due to the fact, that, with 
the ever increasing demands made upon society, through increasing 
density of population, greater efficiency in management is required, 
and, thus, secured, than would, otherwise, be possible, with all of 
the conflict, and delay, and expense, which attend the separate 
management of many small concerns. The recognition, by society, 
of the utility of organization, manifested by the enactment of laws, 
and compliance with regulations, designed to meet the ever-increas- 
ing demands made upon it, is, what some influenced by prejudice, 
and others too, little appreciating the utility of wealth, are pleased 
to call class legislation, truckling to the money power, fostering 
monopolies, and other, equally, misleading and ill-advised expres- 
sions. 

That it has been possible to secure, to so many people, so much 
liberty, and so many of the comforts and luxuries of life, as the 
American people have enjoyed, during the century that is now clos- 
ing, is the highest testimonial to the business character of the Amer- 
ican people, and to the sterling qualities of American business men. 
Granting, that the manufacturer, or capitalist may derive some 
temporary advantage from the enhanced prices of protected arti- 
cles, the wage-earner and person of moderate means will derive 
equal or greater advantages ; for with a larger number of people 
using more of every kind of product, due, to increased prosperity, 
from employment afforded, and liberal wages paid, industry is re- 
warded, a demand arises for new inventions, and improved pro- 
cesses of production, to supply the increased demand for products; 
and, thus, through increased production, and general lowering of 
prices, an advance in wages is realized, by means of an increase in 
the purchasing power of money. It, thus, becomes possible, for 



^4 INDUSTRIAL V 110 1ST, EMS. 

the wage-earner by reasonable industry and economy, to prevent 
any undue accumulation of wealth, through the means afforded 
him of appropriating a share of it, and, thus, the assertion of a 
well-known economic writer, that the public welfare is subserved, 
by as liberal a use of capital, as possible, in productive enterprise, 
is realized, when the proposition, that labor is receiving a constantly 
increasing ratio of a constantly increasing product, while capital is 
receiving a constantly diminishing ratio of a constantly increasing 
product, is verified in practice. It was upon the ground of diver- 
sifying industry, and providing for the general welfare, that Alex- 
ander Hamilton, in common with many of the early patriots, based 
his defense of the protective policy. Arguing the question upon 
constitutional grounds, he declared, that the power to raise money, 
as embodied in the constitution, is plenary and indefinite ; and the 
objects, for which it may be appropriated, are no less comprehen- 
sive, than the payment of the public debts, providing for the com- 
mon defense, and the general welfare. The published writings of 
Thomas Jefferson, show him to have been equally pronounced in 
favor of the protective policy. 

Mr. Calhoun, when advocating the best interests of the American 
people, stated, as quoted in the language of Mr. Blaine, that he be- 
lieved that the vital deficiency in our financial system, was a lack 
of manufactures ; and to supply that deficiency, he was willing to 
extend the protecting arm of the Government. His exact language 
quoted is a,s follows : " When our manufactures are grown to a cer- 
tain perfection, as they soon will be under the fostering care of the 
Government, we shall no longer experience these evils. The farmer 
will find a ready supply for his surplus products, and what is 
almost of equal consequence, a certain and cheap supply for all his 
wants; his prosperity will diffuse itself through every class in the 
community. These are, but, a few examples, of the many expres- 
sions of distinguished public men, in favor of the protective policy. 
That we can ill afford to invite disaster, by encouraging the adop- 
tion of any experimental policy, looking to the regulation of our 
commercial dealings with foreign nations, is, quite, apparent under 
present conditions ; that with business depressions, labor unem- 
ployed, diminished revenues, and threatened complications, due to 
the variance of opinion regarding the kind of legislation, best 
adapted, to preserve the integrity of our monetary system, we have 
need for the exercise of the highest discretion, will scarcely fail to 
be apparent to all. Can we, under these conditions, afford to assist 
in carrying the burdens of foreign nations, by affording their pro- 
ducts free access to our markets, without receiving any compensa- 
tion in the direction of reciprocity? Shall we not, rather, revive 
industry in our country, and develop its resources, by adhering to 



INDUSTRIAL PROBLEMS. 25 

a policy which has contributed, so greatly, to our prosperity, in the 
up-building of American industry ? 

That any legislation of a partizan, or sectional character is, ex- 
ceedingly, unwise, becomes manifest, when the, rapidly, increasing 
inter-dependence between sections of our country, and branches of 
industry is considered. That the American people are bound to- 
gether, by the ties of sympathy and affection, is not more truly the 
fact, than, that our industrial and social system is becoming more 
coherent, each year, through the facilities afforded by modern ap- 
pliances, for the transmission of intelligence, and interchange of 
commodities. One of the, unmistakable, indications of prosperity 
for the American people, during the last quarter of a century, is the 
steady increase in the purchasing power of money. 

Among the benefits noted as a result may be named, the greater 
leisure, and increasing opportunities afforded to workingmen for 
enjoyment and improvement. 

That working-men have no cause for complaint against the pro- 
tective policy, but that the error, when found to exist, lies, mainly, 
with themselves, in failing to improve, as well as they might have 
done, the splendid opportunities, to reap a bountiful harvest, is, 
but, too well, evidenced by the spirit of unrest, clamoring, and dis- 
content, which are, ever, such unfailing indications of past prosper- 
ity and lost opportunities. 

A statement, sometimes, advanced, as an argument against pro- 
tection is, that, with free raw material, our manufacturers would be 
able to compete, more readily, with foreign manufacturers for a 
share of the world's trade. That this had no weight, as an argu- 
ment against protection, prior to the enactment of the existing 
tariff law, during the short period in which the tariff law of 1890 
was in force, becomes manifest, when the fact is considered, that 
in virtue of the rebate allowed under the latter, ninety-nine per 
cent, of the duty levied upon all raw material, imported with a view 
to manufacture and re-shipment, for sale in foreign markets, was 
refunded to the importer, upon re-shipment of the finished product; 
one per cent., only, being retained, as charges for the cost of the 
transaction. The McKinley law provided ample revenue to defray 
the expense of Government, and taxed the foreign article not un- 
reasonably, in lieu of the privilege of being brought into a great 
market for sale. That foreign products were not taxed excessively, 
but that the importer found ample profit from the American trade, 
is shown, by the extent of that trade. 

The tariff law of 1890 secured, to the American people, an abund- 
ance of products, of both foreign and home manufacture, and, at 
the same time, protected American capital and enterprise, and by 
so doing, protected American labor. That American labor was pro- 



26 INDUSTRIAL PROBLEMS. 

tected, and, that the American market is superior to all other mar- 
kets, is shown, by the great consuming power of the American 
people, due to their better mode of living, and improved social con- 
dition. This consuming power has been estimated by good author- 
ity, to be equal to ten times the average consumption of all the 
rest of the world. That this is an, approximately, correct estimate 
becomes manifest, when the wages received by the American work- 
ingman, is compared with the wages received by the workingmen of 
other countries. That nations with whom we had entered into com- 
mercial relations under the McKinley law believed that they were 
benefited thereby, is shown by their consumption of our products. 
In virtue of the reciprocity clause of that law, our exports were 
reaching unparalleled limits, amounting to the enormous sum of 
one billion and thirty million dollars in one year, or to one hun- 
dred and twenty millions more than ever before. This is shown 
by the report of the United States Senate Finance Committee ; and 
by the same report the purchasing power of money is shown to have 
increased seventy per cent, from 18(30 to 1890, resulting in a corre- 
sponding increase in wages. 

It has been, authoritatively, stated, that if the wages of the peo- 
ple of the United States, engaged in productive industry during the 
year 1891, were reduced to the level of the wages, received at the 
close of the free-trade era of 1846-60, it would amount to the, enor- 
mous, sum of three thousand millions of dollars. What greater 
testimonial, than this, can be furnished, to the great work of the 
Republican party, in championing the cause of protection ? 

This steady advance in wages is one of the, indisputable, argu- 
ments in favor of protection, as well as one of the most convincing 
in disproof of the statement, so often made, by free-silver agitators 
and fiat-money theorists, namely : that all commodities are depre- 
ciating in value, as a result of appreciation in the value of gold. 

If appreciation in the value of gold, alone, causes depreciation in 
the value of commodities, why should the price of labor be any 
exception to the rule ? Yet, we find that such is plainly, the fact, 
as shown by the above cited report. 

That a nation possessing an extensive territory, with soil and 
climate adapted to a wide range of products, with vast fields of 
mineral wealth lying dormant in the earth, with thousands of square 
miles of fertile soil awaiting cultivation, and with multitudes of 
working-men seeking employment, should countenance a policy the 
logical result of which is to discourage enterprise, and to depress 
industry, seems beyond human comprehension. In view of the 
experiences of the past, shall it be said that we are prepared for an 
era of commercial depression, similar to that which followed the 
lowering of the tariff rates in 1816, 1833, or 1857 ? Of the first of 



INDUSTRIAL PROBLEMS. 27 

which periods, Henry Clay remarked, that he had never witnessed, 
in the country, a period of severer commercial depression ; the 
compromise-tariff of 1833 being followed by business inactivity and 
financial distress, which was only relieved by a return to the pro- 
tective policy in 1842; and the lowering of tariff rates in 1857, 
and resulting depletion of the National Treasury, being due to a 
misapprehension as to the causes of the short period of prosperity 
which followed the revenue tariff of 1846. When the intimate re- 
lation of labor and capital is considered, and the fact, that in a 
nation of almost boundless resources, of just laws, and of equal 
opportunities, no insurmountable barriers to success should be 
found in any calling; we are enabled to realize, that in preserving 
the American market for American labor, by levying such rates of 
duty upon imported products, as will equalize the difference in 
wages received, here, and abroad, and by, thus, encouraging enter- 
prise, guarantee, to all, a more equitable share of the products of 
labor, protection is found to be, essentially, in accordance with the 
principles of republican government, and to fulfill the demands of 
a higher civilization. 



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